Nvidia is the new Apple

Hey, this is Vlad writing from Taipei this week. At this year’s biggest gathering of AI chipmaking power players, the competition is shaping [View in browser]( [Bloomberg]( Hey, this is Vlad writing from Taipei this week. At this year’s biggest gathering of AI chipmaking power players, the competition is shaping up an awful lot like the early age of smartphones. But first... Three things you need to know today: • Nvidia is [still working on]( the certification process for Samsung’s high-bandwidth memory chips • ByteDance hired a new general counsel with [responsibility over TikTok]( • A pro-Russian effort is using fake videos to spread disinformation about the [coming Olympic Games in Paris]( Our system or everyone’s Nvidia Corp.’s proposition to the world: Sign up with us and you’ll get the best hardware, software and services you need to train artificial intelligence models. We’ll build an ecosystem of developers and give them the best tools to make apps. We’ll upgrade the key components once per year. It’ll be pricey and you’ll sacrifice much compatibility with our rivals, but you won’t have to sweat any of the details. That pitch, presented by Chief Executive Officer [Jensen Huang](bbg://people/profile/1782546) as he paced a 100-foot-wide stage Sunday night inside a sports hall in central Taipei, reminded me of how Apple Inc. sells the iPhone to consumers. The two companies’ market values are converging at somewhere close to $3 trillion and 61-year-old Huang [carries echoes]( of Apple icon Steve Jobs, as a co-founder-turned-CEO whose name is synonymous with the business he runs. Set against that is basically everyone else who sells chips for a living. Advanced Micro Devices Inc.’s retort on Monday reminded me of Alphabet Inc.’s Google and its Android ecosystem. AMD CEO [Lisa Su](bbg://people/profile/4353300) put forth this case in the opening keynote to the Computex trade show: Adopt the open standards we’re promoting and you won’t be tied down to us; we’ll let you plug and play tech from all providers, craft your own apps and customize your hardware mix as you see fit. The [proprietary versus open battle]( is back. Rewind 15 years and you’ll see examples of both approaches succeeding and failing. Apple redefined smartphones with the iPhone in large part because it controlled the entire experience from start to finish. It whittled away imperfections and micromanaged every aspect of every iPhone. The payoff was huge. So what if the services were only compatible with Apple devices or connectors like Lightning that work with nothing else? Well, that strategy only lasts as long as you’re the best. Sony Group Corp. tried similar tactics with its consumer electronics earlier, and the Sony Ericsson phone brand is now consigned to history. It’s hard to get people to keep choosing you over the long run, when you force them to turn their backs on everyone else. On the open front, I don’t yet know if AMD is the Google or the Nokia of the AI data center race. Nokia phones also touted openness and a welcome-all-comers app framework with Qt, but that didn’t soften its fall. Android has succeeded largely in spite of the lack of focus that comes from having many players using the same standard. Intel may be playing a role closest to Motorola, a once-unquestioned leader in the field that's struggling to keep up. At Computex this week, practically every major chip design company is hosting a presentation about how its AI hardware is paving the way to stratospheric growth a la Nvidia. Qualcomm Inc. CEO [Cristiano Amon](bbg://people/profile/3259554) declared the rebirth of the PC (courtesy of his company’s chips) and compared the current moment to the launch of Windows 95 in redefining personal computing. [Rene Haas](bbg://people/profile/19549142) of Arm Holdings Plc may have set me on this nostalgic line of thinking by throwing things all the way back to the Apple Newton the previous day. There is a vast opportunity to sell AI chips for laptops and smartphones or for some advanced robotics system. But from conversations with industry observers and executives in Taipei, it’s obvious that the data center is where all the highest-margin business is, and Nvidia’s lead there — as of now — is insurmountable. Just like Apple, Nvidia has cornered the premium and most profitable segment of the market, leaving AMD, Qualcomm and others to compete for the rest. Analyst Ian Cutress of [More Than Moore]( put it to me like so: “If you’ve got 10 voices in the room and one voice accounts for 90% of the market, what do the others do? They gang up on that one, present a united front.” This was manifest in Huang and Su’s keynotes. Nvidia had a two-hour presentation that drew cheers from a packed crowd and positive reviews from analysts, sprinkled with jokes in Taiwanese that elicited laughs. But while Huang would make cameos at other events in the following days, for his most important appearance, the executive was alone in the spotlight. AMD’s Su brought out a succession of fellow industry leaders, from the CEO of HP Inc. to Lenovo Group Ltd. and Microsoft Corp. executives, to show the breadth of her company’s friends and partners. They say it’s lonely at the top, and that’s the takeaway for me from this trade show. For now, as Cutress said, the frenetic demand for AI computation is such that every chipmaker can grow fairly freely. Things will get more interesting as the pace of innovation slows. But it may take until at least next year’s Computex before that happens.—[Vlad Savov](mailto:vsavov5@bloomberg.net) The big story The New York Stock Exchange [fixed]( a software glitch that triggered trading halts and showed erroneous 99% drops in share prices of companies including Berkshire Hathaway. It was the third tech-related disruption to hit US markets in the past week. One to watch [Watch Qualcomm Inc. Chief Executive Officer Cristiano Amon interviewed on Bloomberg Television about the company’s new chip for PCs.Â]( Get fully charged Poland will spend about $760 million to improve cybersecurity after [attacks the government blames on Russia](. Keith Gill may be sitting on more than $170 million in [GameStop options](. Nvidia and Advanced Micro Devices chiefs squared off in a [growing rivalry in AI chips](. 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